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Question 61 Selectable Answer

Which statement about a multinational institution’s ability to fully investigate unusual activity in all its foreign operations is correct?

A. Local privacy and data protection laws may prevent an affiliate from sharing information.
B. Certain account documents may be stored only in local language which will prohibit a global assessment.
C. The institution should consult with the customer and request permission to conduct a full investigation into all the accounts.
D. Enterprise-wide compliance oversight rules issued in the global institution’s headquarters country will override any local limitations in other countries.

Answer:

Question 62 Selectable Answer

What is the primary action a financial institution should take before formulating its anti-money laundering program?

A. It should perform a comprehensive risk analysis
B. It should determine how extensive and well-trained the compliance staff is
C. It should consult with its correspondent banks to determine the nature and extent of their AML programs
D. It should ensure that its training modules for all employees cover all relevant AML issues

Answer:

Question 63 Selectable Answer

How can a ‘free-look provision’ as part of a life insurance policy help criminals to launder money?

A. A policy owner can decide how to pay the premium within a pre-defined period.
B. A policy owner is able to terminate the contract without penalties such as surrender charges.
C. A policy owner has freedom to decide who the beneficiary of the policy will be and can in this way move money to a related third party.
D. A policy owner has freedom to decide who the beneficiary of the policy will be and can in this way move money to an unrelated third party.

Answer:

Question 64 Selectable Answer

Which are the two most common controls a financial institution (FI) uses to identify suspicious money-laundering activity? (Choose two.)

A. Sanctions screening
B. Adverse media information
C. Governmental subpoena
D. Search warrant
E. Transaction monitoring rules

Answer:
Explanation:
Reference: https://www.fatf-gafi.org/media/fatf/content/images/Updated-2017-FATF-2013-Guidance.pdf

Question 65 Selectable Answer

Which two aspects of precious metals pose the highest risk of money laundering? (Choose two.)

A. Some precious metals can be formed into other objects, making easier to transport
B. Precious metals have high intrinsic value in a relatively compact form and are easy to convert into currency
C. The value of precious metals can be inflated easily, making it easy to increase the amount of moneylaundered
D. Precious metals can be readily used in many high-tech commercial applications, makingthem all the morevaluable

Answer:

Question 66 Selectable Answer

Which type of sanctions are most likely to be used in order to avoid escalating violent conflicts and/or proliferation of weapons?

A. Financial prohibitions
B. Export and import restrictions
C. Arms and related materials embargo
D. Asset freeze

Answer:
Explanation:
Reference:https://collections.unu.edu/eserv/UNU:6431/UNSanctionsandPreventionConflict-Aug-2017.pdf (3)

Question 67 Selectable Answer

What action should a bank CEO's assistant take when the bank CEO expenses large sums of money to a charitable organization run by the bank CEO's direct family member?

A. Report the actions to the Executive Board of the bank.
B. Meet with the bank CEO to learn why the donations are being made.
C. Investigate the charitable organization's relationship with the bank CE
D. Submit the concern anonymously to the bank's internal Compliance Hotline.

Answer:

Question 68 Selectable Answer

A local law enforcement officer, who is conducting a criminal investigation, requests information about a customer.
Which two actions should the bank take? (Choose two.)

A. Close the account immediately
B. File a suspicious transaction report
C. Monitor the account for suspicious activity
D. Review the money laundering risk posed by the account

Answer:

Question 69 Written Answer

Bank A is located in CountryA. A wire transfer from Bank B located in Country B is processes by Bank A, where the funds are being moved to a customer at Bank C located in CountryC. The wire transfer is deemed suspicious by Bank A.
Who should Bank A file a suspicious transaction report on?
A. The transaction in Country A
B. Bank B in Country A
C. The transaction in Country B
D. Bank C in Country C

Answer: A

Question 70 Selectable Answer

A customer opens a corporate account with a broker-dealer on behalf of several beneficial owners, with astated long-term investment goal. The customer deposits $25.5 million into the account and three days later transfers $5 million to an overseas bank. Shortly thereafter, the customer begins making numerous purchases of pesos. The compliance officer receives a query regarding the movement of funds. Within a month of account opening, the customer depletes the account.
Which two red flags should prompt the firm’s compliance officer to take action? (Choose two.)

A. The new account deposit is $25.5 million
B. A corporate account is opened on behalf of several beneficial owners
C. The compliance officer receives the query regarding the movement of funds
D. The customer’s stated investment goal is not reflective of account activity

Answer:

Question 71 Selectable Answer

Which of the following represents the first Financial Action Task Force initiative?

A. The 40 Recommendations on Money Laundering
B. The Report on Non-Cooperative Countries and Territories
C. The Report on Money Laundering Typologies
D. The Special Recommendations on Terrorist Financing

Answer:

Question 72 Selectable Answer

Which transaction should result in a SAR/STR filing?

A. A small business owner deposits checks totaling $9,950 USD on a daily basis without providing a legitimate purpose.
B. A small business owner deposits $25,000 USD in cash proceeds with a business equipment bill of sale.
C. A national food-chain restaurant with multiple cash transactions at various branch locations.
D. A national food-chain restaurant makes multiple, anticipated cash transactions that are above the daily reporting threshold.

Answer:
Explanation:
Reference: https://aml-cft.net/library/suspicious-transaction-report-str-suspicious-activity-report-sar/

Question 73 Selectable Answer

A close relative of a privately-owned bank's senior manager requests to open an account. Because of this relationship, the staff expedites the opening of the account without following established account-opening procedures.
Applying the Basel Committee on Banking Supervision principles, which of the following poses the highest operational risk?

A. Failure to conduct proper due diligence.
B. The possibility of lawsuits that adversely affect the operations of a bank.
C. The bank's exposure to politically exposed persons.
D. Not having appropriate information to share with Financial Intelligence Units.

Answer:

Question 74 Selectable Answer

A suspicious transaction report has been filed on an account owned by the wife of the bank's Chief Executive Officer.
Which of the following is the most important consideration when deciding whether to recommend closing the account?

A. The institution's anti-money laundering policy
B. Requests from the competent authority
C. Customer relations
D. Chief Executive's reputational risk

Answer:

Question 75 Selectable Answer

A remittance company received a money order from a senior political figure m the Philippines to transfer a large sum of money to a charity group in the Philippines. A review of the charity group revealed a director having dose ties with a known terrorist group primarily financed through kidnapping and extortion.
What is a key risk indicator associated with terrorism financing?

A. The sender is a Political Exposed Person (PEP) and should be subject to enhanced due diligence
B. A large sum sent by money order to a charity
C. There is no risk relating of terrorism financing when the charity group is operating legitimately in that country
D. There is a link between the charity group and a known terrorist group

Answer:

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